MORNING COFFEE

Abbott buys Facet Biotech. Abbott Labs (ABT) announced that it has agreed to buy Facet Biotech (FACT) for $27 per share in cash, a net value of about $450 million. The deal will allow Abbott to beef up its early and midstage pipeline, and to gain access to new drugs, including a potential treatment for multiple sclerosis.

Prius Accident Under Investigation.  Following a report of a sudden acceleration problem in a Prius in California regulators and Toyota (TM) officials are launching individual probes into what went wrong with the hybrid car. Prior to this the Prius had only been recalled for braking problems.  Analyst are now saying that the cost of the recalls could surpass $5 billion in the next year.

Government May Sell Citi Stake. The U.S. may sell its stake in Citigroup (C) sooner rather than expected, with reports saying a sale could occur this spring. Federal officials had said they plan to unload the government's 27% stake in Citigroup over the next year, but hadn't indicated it could happen on such an accelerated timetable.

Cisco Unvails Fastest Router Ever. Promising to "forever change the Internet," Cisco (CSCO) introduced a new kind of router yesterday that triples its predecessor's capacity to 322 terabits per second. To put that in perspective, the router has the capacity to stream every movie ever created in less than four minutes.

J. Crew (JCG): Reported Q4 EPS of $0.61 beating estimates by +$0.15 on revenue of $461 million.  The company also gave Q1 EPS guidance at upper end of consensus.

Upgrades

Analog Devices (ADI): Bernstein upgraded their rating from Market Perform to Outperform.

Edison (EIX): Jefferies & Co upgraded their rating from Hold to Buy and raised their target price from $35.00 to $37.50.

Downgrades

Barclays PLC (BCS): FBR Capital downgraded their rating from Outperform to Market Perform.

J. Crew (JCG): Citigroup lowered their rating from Buy to Hold.

Comerica (CMA): Soleil lowered their rating from Buy to Hold and lowered their target price from $40.00 to $37.00.

Coverage Initiated

Netflix (NFLX): Canaccord Adams initiated coverage with a Buy rating.

Cabela's (CAB): KeyBanc Capital Markets initiated coverage with a Hold rating.

·         Futures: Dow +0.1%. S&P +0.1%. Nasdaq +0.2%. Crude +0.2% to $81.64. Gold +0.4% to $1126.80.

·         Asia: Nikkei flat at 10564. Hang Seng flat at 21208. Shanghai -0.7% to 3049. BSE +0.3% to 17098.

·         Europe: London +0.1% to 5607. Paris +0.3% to 3922. Frankfurt +0.2% to 5900.